In the United States, stock investors must comply with the Regulation T of the Federal Reserve Bank and may borrow up to ___ of the value of the securities from their brokers.

In the United States, stock investors must comply with the Regulation T of the Federal Reserve Bank and may borrow up to ___ of the value of the securities from their brokers.
A . 30%
B . 40%
C . 50%
D . 60%

View Answer

Answer: C

Explanation:

T Identify the regulation:

Regulation T of the Federal Reserve Bank governs the amount of credit that brokers and dealers can extend to investors for the purchase of securities.

Borrowing limit:

Regulation T allows investors to borrow up to 50% of the value of the securities from their brokers.